Labour tax rise ‘will be halved’ by Tories

The Conservatives will try to seize the electoral initiative today with a pledge to reverse part of Labour’s national insurance rise due to come into effect next year.

After several weeks in which the Tory poll lead has narrowed, George Osborne, the Shadow Chancellor, will announce that the party will cut the cost for employees and employers, who each face a 1 per cent increase in contributions from April 2011.

It is understood that the Tories would reduce the planned rise by about half, although only low and middle-income earners would benefit. The announcement comes on the day that Mr Osborne confronts Alistair Darling, the Chancellor, and Vince Cable, the Liberal Democrat Treasury spokesman, in the first big television debate of the election campaign.